Yahoo Finanza Moderna Rallies to Resistance
Moderna Inc. (MRNA) consolidated under 50-day moving average resistance in Monday’s pre-market session, trading more than 50 points below the euphoric Feb. 8 all-time high at 189.26. The stock has lost ground since hitting that peak and failing a breakout above the December high, dropping into intermediate support in the 130s. Long-term relative strength oscillators now suggest vulnerability into the 110s.
Long-Term Cash Flow
Even so, their SARS-2 vaccine looks like the Tesla Inc. (TSLA) of COVID-19 treatments, potentially signaling years or decades of strong revenue growth through boosters and new biohazards. Moderna added to that bullish theme last week, announcing the first doses in a study evaluating booster candidates targeting the South African variant. The research and eventual dosage fees should prove lucrative if these pathogens follow the path of influenza and other SARS outbreaks.
The biotech juggernaut touted the current vaccine’s efficacy with the SA variant in their press release, noting “Previously published data has shown that vaccination with the Moderna COVID-19 Vaccine produced neutralizing titers against all key variants tested, including B.1.1.7, first identified in the UK, and B.1.351, with a 6-fold reduction in neutralizing titers against B.1.351. Out of an abundance of caution, Moderna is pursuing a clinical development strategy against these emerging variants.”
Wall Street and Technical Outlook
Wall Street consensus has eased since massive upgrades following the March 2020 lockdown, with an ‘Overweight’ rating based upon 7 ‘Buy’, 5 ‘Hold’, and 1 ‘Underweight’ recommendation. Two analysts now recommended that shareholders close positions and move to the sidelines. Price targets currently range from a low of just $80 to a Street-high $208 while the stock is set to open Monday’s U.S. session more than $40 below the median $1832 target.
Moderna cleared 2019 resistance around 30 in April 2020 and took off in an historic uptrend that settled in the upper 80s in May. A November breakout lost momentum above 175, giving way to a pullback to 20-day moving average support, followed by a failed February breakout attempt. The stock is now pulling back once again, carving the next stage in a trading range that could persist well through the second quarter.
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Disclosure: the author held no positions in aforementioned securities at the time of publication.
This article was originally posted on FX Empire
